Time for a change? Dan Jago as Tesco’s new category director of beers, wines & spirits

Dan Jago, ex-joint MD of Bibendum has had a four-week taste of Tesco as new category director of beers, wines and spirits. He’s tried everything from being behind the checkout to unloading lavatory rolls at 4am. What’s his view of the retailer and does he have plans to alter the way it does business? Patrick Schmitt reports

It’s an exciting time for the drinks industry when a dynamic, outspoken and long-time supplier turns buyer for the largest wine retailer in the UK. Hence the hope pinned on Dan Jago, ex-joint MD of Bibendum and newly appointed category director of beers, wines and spirits at Tesco. Will he increase the range of wines sold through the supermarket? Attempt to raise average prices? Encourage fewer half-price offers and more in-store tastings? After only four weeks in the hot seat it’s hard to say, but Tesco certainly seems to have already dripped intravenously into Jago, and is now circulating rapidly under the pressure of a new role.

Jago brings Tesco, as he says, "a fresh pair of eyes," and while he commends current employees’ "energy, experience and sheer hard work," he also points out that "the work load and challenges they set themselves means that quite often the ‘wood for the trees’ adage comes up – they are very busy people and sometimes they don’t get as much time to look at the real detail, the nice bits of the industry, the icing."

Suppliers shouldn’t expect Tesco to become any softer under Jago. "It’s a challenging market for retailers and suppliers and I don’t see that getting any different," he says, adding, "Fast moving businesses are always challenging to the people that work with them."

Prices too are unlikely to surge upwards when it comes to beer, wine or spirits. "Tesco have a policy that they will always be competitive in the marketplace although it would be wrong to say that Tesco have an ambition to lead the market down in price."

Tesco’s range review last year was, according to Jago, "basically the withdrawal of duplication – there were an awful lot of £4.99 Chardonnays from the New World on the shelf," and stripping some of these has given Tesco "space to put in a premium range of fine wines, which is selling well." Currently some 800 wines sit on the shelves of Tesco’s largest stores, including 50 from the new fine wine range.

As for discounting, while Jago is looking for a "balance", he also says, "customers have said they love being able to try really good wines for very good value offers, so they [the half-price deals] are not going to go away." He does want to "get more information on shelf, using the likes of shelf barkers but also "Tesco TV, with screens in the wine aisles." On the other hand, Jago’s main aim is to simplify the way wine is retailed.

"Wine is probably not the halo category it was in Allan Cheesman’s days at Sainsbury’s where it was used as a method to get people to come into stores," begins Jago. "It’s now a core part of the weekly shop for a lot of customers and making the weekly shop easier, simpler for our customers, is one of the core parts of our strategy."
This doesn’t mean "removing choice," Jago insists, however it does involve "trying to make more interesting and esoteric wines more accessible to customers."

"Simpler" also applies to the supply chain. The likes of shelf-ready packaging Jago describes as a "big challenge" but adds that "making it simpler to get on shelf is absolutely paramount. If a supplier is not thinking how can I make it easier to get the wine from the winery to the Tesco warehouse, out to the Tesco store, onto the shelf, into the customer’s trolley and home, and then useable at home, then they are missing out on a large opportunity."

Finally, it’s worth noting that Tesco is intending to improve the limited range of wines found in its Express and Metro outlets. "I hope that by the autumn there will be a different range. There is a need for core brands to be there but also a need for a more diverse range that is tailor made to the location and the demographics of the people who shop in those stores. So, there’s no reason why our fine wine range shouldn’t have a very limited selection in Express stores as well. There might be three or four from this – for example, a Central Otago Pinot Noir, a good Claret, a nice Burgundy, and really good Californian Chardonnay. Just because people are shopping in an Express format doesn’t mean they don’t want to spend £15/20 on a really great bottle of wine to take as a present or for dinner."

Overall, although Jago is still boning up on his beer and spirits retailing knowledge having come from a purely wine-based background, he already has a clear idea of what he wants to achieve in his new post. "My ambition is for Tesco to be regarded as the best wine and drinks retailer in the world." For him, this should not be judged on scale, but customer response. "Any customer, whatever their level of interest, can come into a Tesco and there will be something for them in that shop that excites, interests and challenges them."

© db 8th June 2006